4 Tips for Those New to Spread Betting
Spread Betting Guides from City Index.
Here are four things that every spread betting beginner should do before pressing ‘Buy’ or ‘Sell’:
Spread betting demo accounts from providers such as Finspreads and City Index represent an ideal way to learn spread betting.
The demo account allows you to experience stop losses, limit orders and every other aspect of financial spread betting without risking a penny of your own money.
Understanding how to lock in profits and manage your spread betting risk will prove invaluable when you come to join a real trading platform.
Some traders spread bet on instinct alone, trying to spot patterns in the rises and falls in the live markets. This is one of the best techniques for losing money at spread betting, as it effectively turns the trading platform into a roulette wheel.
Make sure know your market and understand how external developments affect it. For instance, if you plan to spread bet on BA shares, you should know that a spike in crude oil prices may result in downward pressure on those British Airways shares.
Remember, in depth research will help you to react more effectively when market moving developments emerge.
Having a trading strategy in place before you make a spread bet means that even before you open your position, you know why you are entering the trade, where you want to take profits and more importantly where you are willing to take a loss.
As well as helping you to place stop losses and limit orders, a spread betting strategy also removes the emotion and spontaneity that can lead to high risk impulse trades in financial spread betting.
With the introduction of mobile and iPhone spread betting, spread bettors can now log into their account and trading platform regardless of where they are.
The greater autonomy afforded can reveal opportunities to profit (or reduce a loss) that you might otherwise have remained unaware of, but for the spread betting beginner it also represents a chance to spend time just watching the financial markets in action without being bound to a computer.
Risk Warning: Spread betting and CFD trading carry a high level of risk to your capital and you may lose more than your initial investment. Spread betting and CFD trading may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.
'4 Tips for Those New to Spread Betting' by DB, updated 11-Jun-13
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